BRUSSELS Prime Minister David Cameron will hold 'now or never' talks on Thursday to keep Britain in the European Union, with the bloc's 28 leaders suggesting there are only a few obstacles left to a new membership deal.

With all sides underlining that there is still work to be done to reach agreement at an EU summit in Brussels, there is also broad consensus that if the bloc fails to agree, they may never come up with a deal to help keep Britain from leaving.

Cameron is keen to end the week in Brussels with a deal that he can hail as a victory and then start campaigning to keep Britain inside the bloc before a referendum most officials expect will be held in late June.

"I think there is an appetite at all levels to try and get there and take as long as it takes us to get there," said a senior EU diplomat of the two-day summit which ends on Friday.

"The mood around town is that people think that if we don't get it solved now, we're never going to solve it."

Cameron, struggling to sell a deal to an increasingly sceptical British public and many in his own Conservative Party, has spent weeks touring European capitals to secure a deal, hold a referendum and put to rest the divisions over Europe that have dogged his party for years.

He has called for reform in four areas: measures to curb migration, safeguards to protect London's financial district from decisions binding the 19 members using the euro currency, for Britain to be excluded from "ever closer union" and for greater competition in the bloc.

EU officials have said there are still worries about whether some of Britain's demands will set a precedent, leading other countries to demand changes to their membership agreements.

And among the details, there will be debate over the wording of the safeguards for London's financial sector, on any commitment to future amendments of the bloc's founding treaties and on how long Britain can apply a measure to curb welfare payments for low-paid EU workers.

OPTIMISTIC

With a prospect of late-night talks on Thursday, summit chairman Donald Tusk has scheduled what aides call an "English breakfast" on Friday in hope of a final compromise.

"The negotiations are very advanced and we must make use of the momentum," he said in an invitation letter to EU leaders.

"There will not be a better time for a compromise."

The stakes are high. A vote to leave would not only transform Britain's future role in world trade and affairs but would also shake the EU, which has struggled to maintain unity over migration and financial crises, by ripping away its second-largest economy and one of its two main military powers.

The British public is split over whether to remain in the European Union, but with opinion polls showing the 'out' campaign gaining ground, Cameron wants to hold the referendum as soon as possible.

Asked if he was confident of a deal, a British government official said the prime minister thought that "we are in a good place".

"We think we have made a lot of progress and we will be going to this summit seeking to nail down the rest of the details and make sure the substance is right."

(Additional reporting by Alastair Macdonald in Brussels and Kylie MacLellan in London; Editing by Ruth Pitchford)

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